The Daily Breakdown looks at markets as geopolitical tensions escalate in the Middle East. The S&P 500 tests a recent support level.
Before we dive in, let’s make sure you’re set to receive The Daily Breakdown each morning. To keep getting our daily insights, all you need to do is log in to your eToro account.
What’s Happening?
This week is starting with a jolt of geopolitically driven volatility after a coordinated strike in the Middle East over the weekend. Oil and the USO ETF are spiking, lifting energy stocks, with the XLE ETF up about 4% in pre-market trading. Meanwhile, the other 10 sectors are lower as the S&P 500 is down about 1%, while the Nasdaq 100 and Russell 2000 are under even more pressure.
Silver and gold are higher as investors rotate to safety, and the US dollar is up as well. Bitcoin is roughly flat, as are Ethereum, Solana, and other major cryptocurrencies — following a notable lack of volatility through the weekend.
Overall, if uncertainty persists or tensions escalate, volatility could stay elevated and keep investors tilted toward defensive assets.
What to Watch
Friday’s jobs report is the key macro event, while the earnings calendar includes: Target, Best Buy, CrowdStrike, Costco, and Broadcom.
Want to receive these insights straight to your inbox?
Sign up here
The Setup — SPY ETF
With this morning’s move, the SPY ETF is once again testing the $670 to $675 support zone. The $695 to $700 area has also acted as resistance for much of 2026. If volatility keeps rising, traders will be watching to see whether support breaks and a deeper pullback develops — or if it holds and gives bulls more confidence.
Options
The SPY ETF is one the few assets that supports daily expiration.
Investors who are bullish could consider calls or call spreads as one way to speculate on further upside, while bearish investors could consider puts or put spreads to speculate on a further move to the downside. For options traders, it may be advantageous to have adequate time until the option’s expiration.
To learn more about options, consider visiting the eToro Academy.
What Wall Street’s Watching
LMT
Lockheed Martin is jumping this morning and is on track for fresh all-time highs as defense stocks rally amid escalating geopolitical tensions. Northrop Grumman, Boeing, L3Harris, RTX, and General Dynamics are also trading higher.
NVDA
Despite strong earnings results, Nvidia declined more than 6% last week. Shares are under slight pressure this morning as investors now eye the recent $170 to $175 area as possible support, alongside the 200-day moving average. Check out NVDA’s chart or dig into its fundamentals.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.
